Observing Possibilities around Organ Food

Conventional and organic products are becoming less expensive as inflation rises.

FREMONT, CA: As prices have soared, US consumers have changed how they buy food, according to the Hartman Group, in April. In addition to eating out less, 36 percent sought cheaper options, and 27 percent bought own-label products. Some 7 percent said they bought fewer organic products. Meanwhile, new research published this week by the UK Food Standards Agency revealed that people make unhealthy compromises in their purchasing decisions due to price overriding their ethical and environmental values.

According to the latest global statistics published in February by the International Federation of Organic Agriculture Movements (IFOAM) and the Swiss Research Institute of Organic Agriculture (FiBL), organic food retail sales will reach almost USD 130 billion. The pandemic raised interest in organic foods, resulting in a record revenue increase of USD 17 billion.

Supply chain: Due to organic's more established position, it may be better able to weather this storm than others in the agri-food industry. Costs for everything from labor to shipping and energy are on the rise.

Aside from that, organic production is usually smaller and has limited access to chemicals and inputs. Since margins are limited and there is no guarantee that farmers will have the boots on the ground when harvest time rolls around, farmers must think on their feet and determine how they invest in their farms.

On the other hand, organic farming has been more insulated from these shocks. Organic farming does not use chemical fertilizers, so suppliers have not been as affected by the fertilizer shortage as conventional farming.

Despite the current crisis, organic food has another silver lining. As a result of Covid-19, inflation, wars, and climate change, the food system has been shocked and brutally exposed to its fragility. Consumer concerns have intensified, as well as calls for long-needed fixes. Consumers will remember the climate crisis as awareness grows.

An organic appeal: People mainly buy organic foods for health reasons. They want to avoid synthetic pesticides, herbicides, and fertilizers. However, the appeal of organic foods varies from market to market.

A study conducted by Ecotone, based in France, indicates that organic food is perceived to be 'better for the environment' (28 percent), 'more natural' (21 percent), and 'helps protect and enhance wildlife biodiversity' (21 percent). According to The Hartman Group, the top three things are 'safe for my family', 'higher quality,' and 'avoiding pesticides' in the US. German shoppers are most attracted to organic foods because of fewer additives and animal welfare. In contrast, French shoppers are drawn to organic foods because of their health and lower environmental impact.